Letter of engagement – This legal term finds application in the sphere of Banking Law. It refers to an official statement, issued by a bank towards the borrower and any interested parties. Where the bank states in the document that if a certain amount of money is deposited and paid to the bank, it will remove the existing mortgage on the particular real estate. The role of such letter is to ensure all involved parties, that if the asked amount is paid to the bank, the property buyer will receive it free of mortgage (i.e. without this legal burden). Usually, sellers of mortgaged apartments obtain from the bank such letter in cases where they negotiate lower amounts to be refunded in one go to the bank for reaching removal of mortgage or even settling the debt towards the bank.
A synonym is “Beneficiary statement”
In practice, a letter of engagement is also used by lawyers as a formal agreement to detail the obligation they undertake towards their clients, to perform a particular legal job. For example, a lawyer will sign it if they are asked to prepare a legal advice. So the client will have a confirmation about the services he has been asked to pay for.